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Japanese shares tumble on strong yen

Do Not UseDo Not Use 2/05/2016
Yen notes © Getty Images Yen notes

Japanese shares have started the week with sharp falls, as a surge in the yen hurt shares in big exporting firms.

westpac signage © Getty Images westpac signage

The benchmark Nikkei 225 ended 3.1% lower at 16,174 - higher than its lowpoint for the trading session, but still the lowest close since 12 April.

China factory worker © Getty Images China factory worker

Shares of Japanese carmaker Toyota closed down 3.8%, Nissan Motor dropped 5% and Honda Motor shed 4%.

The yen shot up after the Bank of Japan (BOJ) decided not to launch fresh economic stimulus last week.

On Friday the yen was at about 108 yen against the dollar. It strengthened a little on Monday to around 106.31 yen.

In South Korea the Kospi ended Monday's session lower, by 0.8% at 1,978.15 points. And that is also a three-week low.

Australian earnings

In Australia, the benchmark S&P ASX 200 finished lower by 0.18% at 5,243 points.

Shares in Australia's third largest lender, Westpac, closed down 3.54% on the Sydney stock market, after having lost as much as 5.7% earlier in the session.

It reported a 3% rise in profits for the six months to March.

Earnings rose to A$3.9bn ($2.96bn; £2.02bn), however industry analysts were expecting the figure to come in just above A$4bn.

Westpac has attributed the shortfall to higher debt charges.

Also in Australia, the country's Treasurer Scott Morrison will deliver the federal budget for 2016-2017 on Tuesday evening. According to local media, there will be tax cuts for business in the budget.

But ahead of the budget, the country's central bank - The Reserve Bank of Australia - will hold its annual meeting on interest rates. The key lending rate in Australia is at a record low of 2%.

Chinese data

Figures from the weekend showed that there could be some stability in China, the world's second biggest economy.

The official purchasing managers' index (PMI) on Sunday showed a reading of 50.1 for April, compared to 50.2 in March.

A figure above 50 indicates an expansion. The PMI tracks activities in factories and workshops.

Markets in China and Hong Kong are shut on Monday for the Labour Day holiday.

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